CHAPTER 7 Financial Operations of Insurers
“To manage an insurance enterprise successfully, you must understand the volatility inherent in each portfolio of risks and investments. Further, you must understand the impact that unexpected volatility has on the balance sheet, income statement, and cash flows.”
Mike Keyes, Chairman of the Board and former CEO, Oregon Mutual Insurance Company
Learning Objectives
After studying this chapter, you should be able to
Understand the three major sections of the balance sheet for a property and casualty insurance company: assets, liabilities, and policyholders’ surplus.
Identify the sources of revenues and types of expenses incurred by a property and casualty insurance company.
Explain how profitability ...
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